Commitments and Contingencies |
9 Months Ended | |
|---|---|---|
Sep. 30, 2017 | ||
| Commitments and Contingencies Disclosure [Abstract] | ||
| Commitments and Contingencies |
16. Commitments and Contingencies Indemnification In accordance with its certificate of incorporation, bylaws and indemnification agreements, the Company has indemnification obligations to its officers and directors for certain events or occurrences, subject to certain limits, while they are serving at the Company’s request in such capacity. There have been no claims to date, and the Company has director and officer insurance to address such claims. Pursuant to agreements with clinical trial sites, the Company provides indemnification to such sites in certain conditions. Legal Proceedings - Fortress
In the ordinary course of business, the Company and its subsidiaries may be subject to both insured and uninsured litigation. Suits and claims may be brought against the Company by customers, suppliers, partners and/or third parties (including tort claims for personal injury arising from clinical trials of the Company’s product candidates and property damage) alleging deficiencies in performance, breach of contract, etc., and seeking resulting alleged damages. On January 15, 2016, Dr. Winson Tang (“Plaintiff”) filed a Complaint against the Company in the Superior Court of the State of California, County of Los Angeles. Winson Tang v. Lindsay Rosenwald et al., Case No. BC607346. As amended, the Complaint alleged a breach of contract by the Company and two of its officers, Dr. Rosenwald and Mr. Weiss, and two claims against other Defendants. On November 3, 2017, Plaintiff and Defendants entered into a Settlement Agreement.
In connection with settlement, above, the Company is required to deliver 200,000 Mustang common shares, which it holds, to the Plaintiff. At September 30, 2017, the Company recorded this transaction as a capital contribution to Mustang and a corresponding expense of approximately $2.0 based upon the closing share price of Mustang shares on the date of settlement was also recorded. In addition to the share issuance, Mustang paid, in November 2017, a $0.2 million cash settlement to the plaintiff, such amount was accrued as of September 30, 2017. The expense for the settlement was recorded in general and administrative expenses on the Condensed Consolidated Statements of Operations at September 30, 2017.
Litigation and Regulatory Matters - National
National and its subsidiaries are defendants or respondents in various pending and threatened arbitrations, administrative proceedings and lawsuits seeking compensatory damages. Several cases have no stated alleged damages. Claim amounts are infrequently indicative of the actual amounts National will be liable for, if any. Further, National has a history of collecting amounts awarded in these types of matters from its registered representatives that are still affiliated, as well as from those that are no longer affiliated. Many of these claimants also seek, in addition to compensatory damages, punitive or treble damages, and all seek interest, costs and fees. These matters arise in the normal course of business. National intends to vigorously defend itself in these actions, and the ultimate outcome of these matters cannot be determined at this time. Liabilities for potential losses from complaints, legal actions, government investigations and proceedings are established where National believes that it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. In making these decisions, management bases its judgments on its knowledge of the situations, consultations with legal counsel and its historical experience in resolving similar matters. In many lawsuits, arbitrations and regulatory proceedings, it is not possible to determine whether a liability has been incurred or to estimate the amount of that liability until the matter is close to resolution. However, accruals are reviewed regularly and are adjusted to reflect National’s estimates of the impact of developments, rulings, advice of counsel and any other information pertinent to a particular matter. Because of the inherent difficulty in predicting the ultimate outcome of legal and regulatory actions, management cannot predict with certainty the eventual loss or range of loss related to such matters. |